June 20 (Bloomberg) -- Taiwan President Ma Ying-jeou named
Wu Den-yih as running mate for his re-election bid, betting the
more-popular incumbent premier will help him stave off growing
support for the opposition in next year’s election.

Wu, a former mayor of southern Kaohsiung City, was
appointed premier in September 2009. The current Vice President
Vincent Siew announced last month he won’t seek nomination for
next year’s election. The Jan. 14 election will pit Ma and Wu,
from the ruling Kuomintang, against the Democratic Progress
Party’s Tsai Ing-wen, who has yet to announce her running mate.

Ma, 60, faces declining support as backing for his pro-China policy weakens and the DPP gains with its pro-independence
platform. Wu has maintained his popularity as premier and may
help the KMT win back voters in southern Taiwan where the
opposition is favored.

“The pick strikes me as a shrewd move to win over the
middle,” Erik Lueth, an economist at Royal Bank of Scotland
Group Plc in Hong Kong, said. “President Ma has strong pro-business credentials, including by promoting warmer cross-strait
relations. By appointing someone with strong roots in the south,
he may not win over hardcore DPP voters but appeal to the
center.”

Wu, 63, had a job-approval rating of 38.5 percent in May,
higher than Ma’s 33.9 percent, according to the Global Views
Monthly research centre. His disapproval rating stands at 48.2
percent, according to the May poll of 1,002 people with a margin
of error of 3.1 percent.

‘Grassroots’

“Because he is from the grassroots and held local
positions for a long time, he has a good understanding of local
people,” Ma said at a press conference yesterday to announce
Wu’s appointment. “He has a compassion for citizens that’s a
very important characteristic for those of us in government.”

Wu became premier after his predecessor, Liu Chao-shiuan,
and the entire cabinet resigned over the slow response to
Typhoon Morakot that killed more than 600 people.

He earlier served as mayor of Kaohsiung for two terms from
1990 to 1998, and was also a legislator from 2002 to 2009. He
was the general secretary of the KMT from February 2007 to
October 2007.

Wu worked as a journalist after graduating from the
National Taiwan University and before being elected a member of
the Taipei City council at 25. After serving for eight years, he
returned to his home in Nantou County in central Taiwan and
became the county magistrate from 1981 to 1989.

One-China Policy

Ma, also KMT chairman, returned his party to power in 2008
after the DPP’s eight years in office saw increased tensions
with China, Taiwan’s largest trading partner and biggest
political rival. The KMT had ruled Taiwan for more than 50 years
after retreating to the island following the party’s defeat at
the hand of Mao Zedong’s communists.

Though political rivals, the KMT and Communist Party are
united in their one-China policy, while local Taiwanese like
Tsai have increasingly sought international recognition of
Taiwan’s independent status. Ma’s administration has signed 15
economic agreements with Beijing in a policy that Tsai has
derided as “boxed in a frame set by China.”

The benchmark Taiex index, which has gained 15 percent in
the past year, fell 0.1 percent as of 10:54 a.m. in Taipei. The
Taiwan dollar appreciated 0.2 percent to NT$28.935 against its
U.S. counterpart.

Support for Ma’s initiatives have faded in the past two
years, with 32.3 percent of respondents in the Global Views
Monthly poll last month considering his cross-strait policy a
“failure,” compared with 24.2 percent in May 2009, while 49.9
percent view it as a “success,” from 53.4 percent two years
earlier.

Opinion Polls

Tsai, 54, who separately held posts of vice premier and
Mainland Affairs Council chairwoman during Chen Shui-bian’s
2000-2008 administration, has benefited from the discord among
voters, according to a May survey by the TVBS Polling Center.

The DPP is concerned Ma’s policies may put Taiwan’s
sovereignty at stake as he pushes for closer economic ties with
the mainland.

Ma would gain 45 percent of votes to Tsai’s 44 percent, the
TVBS survey of 1,006 people conducted May 16 to 19 showed.
Tsai’s support surpassed Ma’s among those aged 20-39, and in
southern Taiwan, according to the poll, which had a 3.1 percent
margin of error.

In the 2008 presidential election, the KMT beat the DPP 58
percent to 42 percent by pledging direct flights to China,
lifting of investment restrictions by Taiwanese companies and
allowing more Chinese visitors to travel to Taiwan.

China regards Taiwan as part of its territory and has
threatened to attack if it declares formal independence. Taiwan
will hold legislative elections concurrently with the
presidential ballot.